Updates, advisories and surprises

Motorola plans $90M pre-tax charge in third quarter (5:52 PM ET) SAN FRANCISCO (MarketWatch) -- Motorola Inc.
MSI, -1.20%
the world's second-largest mobile-phone supplier, plans to take a pre-tax charge of $90 million in the third quarter stemming from its ongoing cost reduction program. According to a Securities and Exchange Commission filing late Tuesday, Motorola said the charge totals about $70 million in severance charges and $20 million of asset impairments.

Mercury: SEC inquiry is now formal probe; lowers Q3 view (5:41 PM ET) SAN FRANCISCO (MarketWatch) -- Mercury Intereactive
MERQE
said after Tuesday's closing bell that an informal inquiry from the Securities and Exchange Commission has become a formal investigation. The Mountain View Calif.-based software company also lowered its third-quarter revenue forecast to $198 million to $203 million, from $205 million to $215 million. Analysts polled by Thomson First Call estimate revenue at $211 million.

Motive says it won't meet forecasts for remainder of '05 (4:31 PM ET) SAN FRANCISCO (MarketWatch) -- Motive Inc.
MOTV
said after Tuesday's closing bell that it no longer expects to meet the revenue and earnings-per-share forecasts that it previously issued for the remainder of 2005. The Austin, Texas-based management software company said it expects a third-quarter loss of 20 cents to 27 cents a share, and a loss of 12 cents to 17 cents a share on a pro forma basis. Analysts polled by Thomson First Call had estimated pro forma earnings of 5 cents a share. Motive expects third-quarter revenue of $16.5 million to $18.5 million. Analysts had estimated revenue of $25 million.

Wright Medical lowers Q3, 2005 forecasts (4:28 PM ET) SAN FRANCISCO (MarketWatch) -- Wright Medical Group Inc.
WMGI, -0.28%
after Tuesday's closing bell forecast third-quarter sales of $73.4 million, or $4 million below its previous outlook. It sees third-quarter earnings of 10 cents to 11 cents a share. The company lowered its sales view, in part, because it didn't meet its expectations for third-quarter recovery in its domestic biologics growth rate, as sales decreased by 10% compared with the year-ago period. Wright also revised its full-year 2005 sales outlook to a range of $315 million to $318 million and earnings view to 66 cents to 70 cents a share.

La-Z-Boy: Q2 results to see 'significant adverse impact' (4:21 PM ET) SAN FRANCISCO (MarketWatch) -- La-Z-Boy Inc.
LZB, -3.13%
said after Tuesday's closing bell that a lack of availability of a key chemical component, coupled with a soft retail environment and damage to one of its plants by a tornado, will have a "significant adverse impact" on its results for the second quarter and potentially beyond. The Monroe, Mich.-based furniture company said one of its key suppliers of polyurethane foam has put its customers on notice that they will be limiting the supply of toluene diisocyanate.

Capital Lease reduces exposure to Winn-Dixie, lowers outlook (12:52 PM ET) NEW YORK (MarketWatch) -- Capital Lease Funding
LSE, +0.89%
shares dipped 2.2% to $10.06 after the New York-based real estate investment trust lowered its outlook for the third quarter to reflect actions taken to reduce its exposure to Winn-Dixie. The company said it sold its $22.4 million in Winn-Dixie pass through certificates and it expects to record a realized loss of about $1.5 million from the sale, and a non-cash mark to market loss related to a reduction in the carry value of the securities of $600,000, or 7 to 8 cents a share. The company said it now expects funds from operations of 10 to 11 cents a share in the quarter, and between breakeven results and a profit of 2 cents a share for the period. Excluding the Winn-Dixie related items, Capital Lease expects funds from operations of 16 to 18 cents a share in the quarter, and earnings of 7 to 9 cents a share.

Vesta Insurance sees $6M-$8M net loss due to Hurricane Rita (12:44 PM ET) SAN FRANCISCO (MarketWatch) -- Vesta Insurance Group Inc.
VTA, -0.42%
on Tuesday estimated its net loss from Hurricane Rita at $6 million to $8 million, after recovery from its 50% quota share reinsurance agreement. The Birmingham, Ala,-based insurance holding company also said it now expects net losses in South Florida from Hurricane Katrina to be less than $1 million.

Brookfield Homes net new orders decline (9:12 AM ET) NEW YORK (MarketWatch) -- Brookfield Homes
BHS, -10.00%
said third-quarter net new orders fell to 246 units from 301 units in the same period a year ago, as an increase in sales in the Washington, D.C. area was offset by fewer homes available for sale in California. The homebuilder said it was still on track to achieve its 2005 earnings target of $6.50 to $7.00 a share, and to close on about 1,750 homes. The company also said it would initiate a tender offer to buy back up to 3 million shares of common stock for $55 a share in cash. The stock closed Monday up 36 cents at $55.89.

Clorox cuts profit targets on rising energy costs (8:46 AM ET) NEW YORK (MarketWatch) -- Clorox Co.
CLX, +0.17%
on Tuesday cut its profit targets for the second quarter and fiscal year because of rapidly rising energy-costs. Additionally, the Oakland-based maker of Clorox bleach, Glad trash bags and other household goods said it will raise prices on about 40% of its products in order to partly offset those higher costs. For the second quarter, Clorox now sees earnings at 41 cents to 47 cents a share, below its August outlook for 50 to 57 cents a share, as well as analysts' average estimate of 55 cents a share, according to Thomson First Call. Full-year earnings are now seen at $2.91 to $3.06 a share, versus analysts' view for $3.05 a share. The company's prior full-year profit forecast was for $3 to $3.11 a share. Clorox did affirm its view for first-quarter earnings of 68 to 72 cents a share, helped by higher-than-expected sales. Analysts' estimate for the quarter ended Sept. 30 stands at 68 cents. The company's stock closed Monday at $54.58, down 96 cents.

Irwin Financial expects earnings to return to normal levels (8:44 AM ET) NEW YORK (MarketWatch) -- Irwin Financial
IFC, +0.91%
on Tuesday said that its mortgage banking unit is expected to return to profitability in the current quarter, which should help the Columbus, Ind.-based bank's earnings return to historic levels. The bank also reduced its mortgage servicing portfolio to $18.5 billion, down from $20.8 billion on June 30. The company will release results Oct. 28. Shares of Irwin Financial closed up 10 cents at $20.49 on Monday.

Rite Aid Sept. same-store sales up 1.1% (8:32 AM ET) NEW YORK (MarketWatch) -- Rite Aid
RAD, -2.19%
Tuesday said same-store sales rose 1.1% in September. Total sales for the month edged 0.4% higher to $1.269 billion from $1.264 billion in the same period a year earlier. Shares of the Camp Hill, Pa., drugstore operator closed Monday at $3.94, up 6 cents.

Nu Skin cuts profit target on sluggish sales (8:27 AM ET) NEW YORK (MarketWatch) -- Nu Skin Enterprises Inc.
NUS, -3.12%
on Tuesday cut its third-quarter profit target because of weaker-than-expected results in China, Japan and the U.S. Third-quarter earnings are now forecast at 24 cents to 26 cents a share, down from a prior expectation of 29 to 30 cents a share. Revenue for the period is expected to advance roughly 2% to $290 million, below the company's forecast for $298 million to $303 million, which led to the profit warning. Analysts polled by Thomson First Call were looking for earnings, on average, of 30 cents a share on $302.7 million in revenue. Shares of the Provo, Utah-based marketer of personal care and nutritional goods closed Monday at $18.70, down 35 cents.

Too liftes profit outlook due to strong back-to-school sales (8:15 AM ET) NEW YORK (MarketWatch) -- Too Inc.
TOO, +2.08%
Tuesday lifted its outlook for the third quarter due to stronger than anticipated back-to-school sales. The New Albany, Ohio-based young girls apparel retailer now expects earnings of 41 to 43 cents a share for the period. The average estimate of analysts polled by Thomson First Call is for a profit of 40 cents a share in the October period. "The key 'tween fashion trends that we capitalized on in early fall have sustained their momentum, providing us with a successful back-to-school season," said Mike Rayden, the company's chairman, president and CEO. The company said Hurricanes Katrina and Rita did a "relatively small amount of damage" to its operations, and that only 5 of its 643 stores remain closed due to the storms. The stock closed Monday at $27.85, up 1.5%.

Walgreen Sept. same-store sales up 7.7% (8:07 AM ET) NEW YORK (MarketWatch) -- Walgreen Co.
WAG
Tuesday reported same-store sales rose 7.7% in September. Total sales for the month rose 10.9% to $3.51 billion from $3.17 billion in the same period a year earlier. Earlier, the Deerfield, Ill., drugstore operator said it has acquired Schraft's A Specialty Pharmacy LLC, a privately held New Jersey based chain that specializes in advanced fertility medications and services. The stock closed Monday at $43.19, down 26 cents.

Bowater to cut costs to offset higher expenses (7:50 AM ET) NEW YORK (MarketWatch) -- Bowater Inc.
BOW, -3.62%
said it would implement a plan to cut its annual costs by $80 million as it moves to offset sharp increases in the Canadian dollar and energy prices. The paper company said it expects third-quarter operating earnings to be $35 million to $40 million, excluding a $9 million gain from the sale of assets. Bowater said higher transaction prices were offset by Katrina-related increases in manufacturing and distribution costs, a stronger Canadian dollar and higher maintenance expenses. The company also said pulp and lumber prices were lower. The stock closed Monday down 12 cents at $28.15.

Martin Marietta lifts earnings outlook (7:43 AM ET) NEW YORK (MarketWatch) -- Martin Marietta Materials Inc.
MLM, -2.29%
Tuesday said it expects earnings of $1.61 to $1.66 a share for the third quarter. This outlook includes a one-time tax benefit of 17 cents a share and a charge of $1.5 million related to a writedown of composites-related inventory. The Raleigh, N.C., producer of construction materials said the forecast was higher than previously anticipated due to continued strong pricing, solid volume, and good cost management. The current average estimate of analysts polled by Thomson First Call is for a profit of $1.30 a share in the September period. For the full year, Martin Marietta sees earnings of $3.80 to $3.95 a share, including the tax benefit. Wall Street's current consensus estimate is for earnings of $3.67 a share for the year. The stock closed Monday at $79.93, up 1.5%.

Cytogen sales fall short of expectations (7:13 AM ET) NEW YORK (MarketWatch) -- Cytogen Corp.
CYTO
said third-quarter product sales rose 8% over the same period a year ago, but fell short of expectations. The biopharmaceutical company also believes 2005 revenue will be below its prior forecast of $20 million, and is therefore withdrawing its previous estimates. The company said gross margin and expenses are expected to be within prior forecasts. The stock closed Monday down 9 cents at $3.95.

Weider Nutrition posts 1Q earns $4.9M vs $3.7M (7:12 AM ET) NEW YORK (MarketWatch) -- Weider Nutrition International
WNI
Tuesday reported first-quarter earnings of $4.9 million, or 18 cents a share, up from a year-ago profit of $3.7 million, or 14 cents a share. Sales rose in the latest three months to $48 million from $43.7 million in the same period a year earlier. Thomson First Call doesn't publish a consensus estimate for the company's results. The Salt Lake City-based seller of vitamins and other various nutritional supplements attributed the sales rise to an increase in demand for branded products but said gross margins were eroded by higher raw material costs. The stock closed Monday at $5.56, up 5.1%.

Western Gas may beat 2005 output, drilling goals (7:10 AM ET) NEW YORK (MarketWatch) -- Western Gas Resources
WGR
said it's on track to meet or beat its drilling and production goals for 2005. "We are in better shape today than we have been in years in obtaining drilling and water discharge permits in the Powder River Basin CBM play," CEO Peter Dea said in a statement. The natural-gas company is set to complete a 850-well drilling program for 2005 and may drill up to 875 wells. Shares ended Monday up 1.3% at $51.88.

Lexmark warns of laserjet, inkjet supplies revenue decline (6:42 AM ET) LONDON (MarketWatch) -- Lexmark International Group
LXK
warned third-quarter earnings and revenue will be far below forecast, due to declining laserjet and inkjet supplies revenue on a reduction in channel inventories as well as lower end user demand. Laser and inkjet printer revenue was lower than expected due to more aggressive product pricing and promotion and slower demand, it added. Lexmark now sees third-quarter EPS at 40 cents to 50 cents a share, excluding a previously announced workforce reduction charge of 5 cents, and revenue falling 4% to 5% from a year ago. It previously forecast EPS between 95 cents and $1.05 a share on low-single digit revenue growth. Lexmark added that while analysis is not complete, the company expects revenue and earnings to be significantly below consensus forecasts.

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